Taxation Goes Global

June 13, 2012

The American founders understood that people would have more say over their government the closer it was to them, which is why the United States was set up as a federal republic. This can be seen within the Constitution, where the federal government is given few powers while state and local governments maintain many, if the people so choose, says Richard Rahn, a senior fellow at the Cato Institute.

This general principle, that government is better when it is closer to the people, now faces a movement without precedent in scale: the movement for the globalization of taxation.

The United Nations is pushing a global financial transactions tax "to offset the costs of the enduring economic, financial, fuel, climate and food crises, and to protect basic human rights."

The World Health Organization, in the name of boosting expenditures for health research for diseases that "disproportionally affect the developing world," has just proposed in a new report a "Financial Transactions Tax and a Solidarity Tobacco Contribution."

James Hansen of NASA again recently proposed a "flat-rate global tax" on carbon to stop global warming.

In 2009, then-House Speaker Nancy Pelosi expressed her support for a Group of 20 "global tax" -- a sentiment echoed by Vice President Biden in March.

These tax mechanisms would divert monies away from national populations that have rightfully earned them (both rich and poor), doling them instead to the ruling elite of developing nations.

Furthermore, there is an inherent lack of accountability for the internationally governing bureaucrats who would oversee such taxes. Not only are they incredibly distant from the people they are taxing, but their actions remain a cut above the purview of national governments.

Tax money tends to be much better spent when the people can see how it is spent and who is spending it. This is accomplished more easily at local levels of government, where there can be more real representation and accountability, rather than at the national level and particularly at the international level, where there is no effective representation.